Electrical Appliance Industry Cluster

With construction and development for many years, the adjustment of production structure, technology structure and industry structure in this field have been increasingly optimized. The industry chains of generators--electricity transmitting and transforming equipments--electrical wires and cables --lighting appliances and storage batteries--household electric appliances have been initially formed.

1. Analysis of existing circumstance for electrical appliance industry in Yangzhou City

There are currently 144 production enterprises with large-scope production capacity in this field of the city. They have achieved the gross value of industry output of 9.2 billion Yuan and formed some special industries and industrial cluster, such as wires and cables manufacturing, lighting appliances and electric power equipments and so on.

1). Wire and cable manufacturing industry

The wire and (fiber optics) cable industry in Yangzhou city has formed a wire and (fiber optics) cable industry cluster based on Baosheng Industrial Park and Lingtang village in Gaoyou after more than ten years' development. By the end of 2003, there were altogether more than 100 wire and cable production enterprises in the city with a total production value of 4.5 billion Yuan, tax revenue of 480 million Yuan and 18,000 employees. In 2003, they produced 83,800 km power cables and 41,600 km communication cables. Their main products included power cables, communication cables, special cables, cable materials, cable trays and cable accessories and so on, among which power cables included: electrical wires, common power cables, HV power cables, radiation cross-linking modified cables and so on, communication cables included: fiber optic cables, communication cables in subway, backbone network cables of Internet, LAN cables, highly-physical foam RF cables and so on, special cables included: wire harness for automobile use, fireproof cables, branch cables, cables for nuclear power station use, waterproof cables, mineral armored cables, explosion-proof cables for mine use, railway signal cables, oil mines exploration cables and so on.

There are 26 production enterprises of wire and cable industries and 46 marketing networks (or offices) in Baoying County with nearly 4,000 employees. In 2003, enterprises in the county altogether produced 55,247 km power cables, 5,518 km communication cables, 23,280 km electrical wires, 32,450 ton of bare copper wires, and 3,060 ton of cable trays. The annual sale of this industry was 2.13 billion Yuan.

The leading enterprise, Baosheng Group, is a state-owned large-scale enterprise group especially in the electrician and electricity productions, such as electrical wires and cables, transformers, switches, box-type transformer substations, busway, trays and so on. The power stations developed by Baosheng Group adopt 19 productions which have gained the title of national patent, such as special shielding control cable, 5-core power cable, computer network data cable, concentricity conductor power cable, low voltage power cable, waterproof medium voltage crosslinked cable, fire retardant busway and so on, and 87 scientific and technological achievements which have passed the ministerial/provincial appraisal. The group has an enterprise technology center and post-doctor working station acknowledged by the state. The group now consists of 18 subsidiary enterprises and establishes Baoying Pierlli Cables Limited Corporation with cooperation of Italy Pirelli Company. The group covers an area of 500,000 square meters and has 2,508 employees including 800 technical personnel from various kinds of specialties. Its total assets amount to 1.299 billon Yuan. And its debt to assets ratio is 41% and its credit grade is triple A. In 2003, the group achieved sales income of 1.9 billion Yuan, among which the profit-before-tax reached 89.87 million Yuan. Its index of production, sales and profit ranked the top list of electricity industry around the country.

The wire and cable industries in Gaoyou County got off its start from the development of township enterprises and farmers becoming rich in the early 1980s. After 20 years' struggle, a wire and cable industrial base has been formed with the main bodies of Lingtang Hui Nationality County and outskirt of Gaoyou County , among which nearly 80% enterprises are concentrated in Lingtang. By the end of 2003, there are altogether 60 enterprises in the county with total assets of 1.03 billion Yuan, 12,800 employees and 2,508 professional technicians. The whole industry has achieved production value of 1.58 billion Yuan and profit-before-tax 196 million Yuan, including profits of 98 million Yuan. The key enterprises include Yangzhou Shuguang Cable Manufacture and Jiangsu Huaneng Cable Co. Ltd.,.

2). Electric power equipments

Jiangdu Town is the most representative area in electric power equipments manufacturing industry in our city. Its key enterprises and distinctive products include: electric anchor clamp taking Jiangsu Jiekai Group, Yangzhou Shuanghui Electric Power Equipment Factory and Jiangdu Shuguang Electric Power Equipment Factory for representatives; generating equipments taking Yangzhou Feihong Electric Power Materials Factory, Yangzhou Yingtai Electric Machinery Group and Jiangdu Jingxing Generating Equipments Co. Ltd., for representatives; and electric transmission and transformation equipments taking Thunder HV Equipment Company, Baoshi Electrical Appliance and Plastic Co. Ltd., and Yangzi Ammeter Factory for representatives. In 2003, the electric power equipments industry in the whole city reached the total production value of 2 billion Yuan, sales income of 1.7 billion Yuan, and profit-before-tax of 0.15 billion Yuan.

3). Lighting appliances

A lighting appliances industry cluster has been initially formed in Yizheng of our city and Guoji of Gaoyou. Yizheng town mainly produces straight-tube fluorescent lamp, grid lamp, tube light and frame lamp. Gaoyou town mainly produces outdoor lighting appliance and landscape light. By the end of 2003, there were nearly 150 production enterprises. They had reached production value of 0.8 billion Yuan and profit-before-tax of 50 million Yuan with more than 60,00 employees.

Yizheng Xin'guang and Philips Lighting Co. Ltd. is a joint venture established by Jangsu Yizheng Xin'guang Lighting Co. Ltd., and Philips Electronics ( China ) Company Limited. The two parties hold 50% stocks of the company respectively. The total investment is 29.98 million US dollars. Its building purpose is to become the largest straight-tube fluorescent lamp production base in China . In 2003, the company reached production value of 194 million Yuan and profit-before-tax of 11.59 million Yuan. Its total assets amount to 187 million Yuan. And its debt to assets ratio is 20%.

Yizheng SFT High-Tech Lighting Industrial Park was invested and built by Jiangsu SFT Lighting Appliance Co. Ltd., with total investment of more than 0.1 billion Yuan. By means of international bidding, the park introduced automatic stream line production having international advanced level, such as soleplate automatic molding, preprocessing, spray painting, vacuum casting, injection molding, die-casting, mould production and so on. It has become the first company to research and develop four production lines of Frame lamp cold-pressure molding, which can annually produce 6 million sets of grid fluorescent lamps, 10 million sets of energy saving tube lights, 10 million sets of frame lamps, 10 million sets of energy saving inductances and electronic ballasts and various kinds of accessory products, such as outdoor lighting casting, punch mold, injection mold, mould and so on.

The lamp and lantern industry in Guoji Town of Gaoyou City has 140 production enterprises and more than 50 lamp and lantern accessories and electricity selling departments. Its products include high-pole lamp, middle or low pole lamp, court lamp, mine lamp, tunnel lamp, landscape lamp and various kinds of advertisement lamp cabinets. In 2003, it realized production value of 400 million Yuan and sales income of 360 million Yuan. The whole town has 6 sets of cut-to-length equipments, 12 sets of hemming equipments, one hot galvanizing streamline, 18 streamlines of plastic spray, 10 sets of injection mold equipments and 16 streamlines of HV sodium lamp.

4). Power supply products

The power supply products of Yangzhou mainly include switch power, UPS, valve-control maintenance free lead-acid accumulator and so on. In 2003, they achieved gross industrial output value of 1.2 billion Yuan (current price) and profit-before-tax of 80 million Yuan (current price).

Yangzhou Oriental Group is the backbone enterprise in this field, which is especially in the development, production and selling of various DC power supplies, UPS, EPS, inverter power supplies, switch power and maintenance free accumulator and relative industries. After a dozen years of development, it has become one of the largest enterprises in international power supply industry. The group has altogether over 130 subsidiary companies, two large-scale production bases, one power supply research institute and more than 3,000 employees.

The Chinese and foreign countries joint venture, Yangzhou Huayang Accumulator Corporation Limited, mainly product automobile accumulator productions, which mainly export to Europe, Australia, South America, Middle East and other countries and regions. It can annually produce one million dry/wet charged low antimony, mixed DIN, JIS and AS series of accumulators.

Enersys ( Jiangsu ) Huada Power Supply System Corporation Limited in Jiangdu City is a solely foreign-owned enterprise invested by Enersys Group which is the world largest industrial battery manufacture factory.

5). Household electric appliance

In June 2003, Greencool Group invested 150 million US dollars in Yangzhou to construct a large-scale production base mainly on refrigerators exporting with annual production of more than 3 million sets.

2. Analysis of advantageous conditions for developing electrical appliance industry in Yangzhou City

Our city possesses many advantages for speeding the development of manufacturing industry. From the aspect of geographic environment, Yangzhou lies in the Yangtze Delta region and overlaying area of Nanjing and Shanghai metropolitan circles, therefore, it enjoys a unique regional advantage. Yangzhou is the first city in Jiangsu province to build the ring road highway, which realizes that all counties in the city are connected by highway. With the opening to traffic of Nanjing-Qidong railway and completion of Runyang Bridge , Yangzhou has formed a large traffic pattern and possessed a favorable traffic advantage with highways and railway network extending in all directions. Infrastructures in Yangzhou and its subordinated counties, cities and development zones are relatively perfect, such as electric power, water supply, sewage disposal, telegraphic communication, port and so on. They have possessed the advantage of resources. In the aspect of developing electrical appliance industry, Yangzhou also possesses the following advantages:

1). Macropolicy advantage. With the change of investment policy of national electric power, fully-geared construction of power supply points and national electric network connection project offer huge commercial opportunities to power station equipments, transmission and distribution enterprises. Governments at various levels continuously increase the force of investment and construction in city infrastructures, informatization construction, communication enterprise and automobile industry, which brings uncommon development opportunity to electrical appliance industry.

2). Solid industrial foundation and favorable industrial complement advantage. After many years' development, Baosheng industrial park and Gaoyou Lingtang village industrial park have begun to take shape with a unique feature of wire and cable industry. Such industries as electric equipment and anchor clamp of Jiangdu, lighting appliance of Yizheng Qingshan and Gaoyou Guoji, and communication power supply, UPS and storage battery of urban development zone and Jiangdu have gradually taken shape into industrial clusters, which lays a solid foundation for future industrial development and centralization.

3). Abundant human recourses. Nanjing , Yangzhou and Zhengjiang, which surround the industrial park, are cities with dense colleges and universities and abundant power of science and technology. There are altogether 36 common colleges and universities and 137 scientific institutions. Therefore, the area possesses relative strength in development, design and manufacture of electrical appliances. Moreover, quality of labor force in Yangzhou is relatively high while price of labor force is relatively low.

3. Development strategy of electrical appliance industry cluster in Yangzhou City

1). Guiding ideology of industrial development

According to national industry technology policy, regard market as guide and technology innovation as motivity, on the basis of current industrial characteristics, combine with advantages of regional resources, strengthen construction of special industrial parks, develop products with distinctive features, strengthen business invitation and capital attraction, continuously adjust and optimize production structure, promote industrial centralization, promote the ability of survive and development and competitiveness of enterprises and regional economy, seize the developing opportunities brought by construction of electric power, communication and infrastructures so as to enlarge and strengthen electrical appliance industry in Yangzhou.

2). Goals of industrial development

Through five to ten years' struggles, electrical appliance industrial chains joined and supplemented in the middle and lower reach of Yangtze River should be initially taken shape. Electrical appliance industry in the whole city is planned to reach the total assets at current price of 30 billion Yuan in 2010. In addition, the ability of enterprise technology innovation should be remarkably promoted. Production and technology level and equipment level in the overall industry should be continuously increased. And degree of production concentration of its main products should be obviously enhanced.

3). Industry distribution

(1). Yangzhou economic development zone concentrates on developing household appliance, switching power supply, UPS and storage battery.

(2). Baoying County concentrates on developing wire and cable industry in Baosheng industrial park, and further develops cable products with high-tech and substitutes for imported goods. After five years' development, it should strive to reach sales income of more than 6 billion Yuan.

(3). Gaoyou City concentrates on developing wire and cable industry in Lingtang, lamp and lantern industry in Guoji and electric tool industry in Xiejia. After five years' development, it should strive to reach industrial scales of 6 billion Yuan in wire and cable industry, 2 billion Yuan in lamp and lantern industry and 3 billion Yuan in electric tool industry respectively.

(4). Jiangdu concentrates on developing generating equipment, storage battery and electric anchor clamp. After five years' development, its industrial scale should reach 5 billion Yuan.

(5). Yizheng City concentrates on developing green lighting industry.

4. Development highlights of electrical appliance industry in Yangzhou City

1). Wires and cables. Regard Baosheng Group, Yangzhou Shugang Cable Factory, Jiangsu Jiangyang Cable Works, Jiangsu Huaneng Cable Co. Ltd. and Jiangsu Zhongshan Cable Works as leading enterprises, regard Baosheng industrial park in Baoying Development Zone, Gaoyou Lingtang Village Industrial Park and electronic industrial park in urban development zone as carriers, and concentrate on developing products of new generation such as optical fibers and cable, communication cable and power cable. In the future five to ten years, this industry should concentrate on carrying out projects of Italy industrial park of Baosheng Group, polymer optical fiber of mechanical load-enduring exploration cable of Zhongshan Cable Works, HV crosslinked cable of Shuguang Cable Works. The newly-added investment should reach 3.3 billion Yuan with newly-added sales income of 8.7 billion Yuan.

2). Household appliances. Regard Yangzhou Kelong Electric Appliance as leading enterprise, and concentrate on building a refrigerator production base with annual production of more than 3 million sets.

3). Electric power equipments. Regard Jiangsu Jiekai Group, Yingtai Electric Machine Group, Jiangsu Beide Electric Machine Co. Ltd., Yangzhou Electric Equipment Build and Repair Factory, Yangzhou Shuanghui Electric Material Factory, Jiangsu Feida Baokai Electricity Co. Ltd as leading enterprises, and concentrate on carrying out projects of extra-high voltage electric anchor clamp of Jiekai Group, frequency conversion electromotor of Beide Company, production enlargement of Yangzhou Electric Equipment Build and Repair Factory. The newly-added investment should reach 200 million Yuan with newly-added sales income of 400 million Yuan.

4). Lighting apparatus. Regard Yizheng Feixin Company, SFT Company, and Gaoyou Guoji Lamp and Lantern Industrial Park as leading enterprises, regard Yizheng development zone and Gaoyou Guoji Lamp and Lantern Industrial Park as carriers, and concentrate on developing new generation products such as high-efficient energy-saving fluorescent, outdoor lighting lamp and electron ballast electronic ballast. Till 2005, the lighting apparatus industry should possess the annual production ability of 65 million sets of T8 type fluorescent, 2 million sets of energy-saving lamps, 8 million sets of electronic ballast for fluorescent lamp and 200,000 sets of high pressure sodium lamps. In the future of five to ten years, it should concentrate on carrying out projects of high-speed horizontal production line of energy-saving fluorescent and low-plumbum glass tube production line of Yizheng Feixin Company, and high-pole landscape lamps of Guoji Lamp and Lantern Park. The newly-added investment should reach 400 million Yuan with newly-added sales income of 1.5 billion Yuan.

5). Power supply products. Regard Yangzhou Oriental Group, Yangzhou Communication Equipment General Factory, Yangzhou Huayang Storage Battery Co. Ltd., Enersys (Jiangsu) Huada Power Supply System Co. Ltd., and Jiangsu Zhenghe Group as leading enterprises, regard urban development zone and Jiangdu City Development Zone as carriers, and concentrate on developing switching power supply, UPS, valve-control maintenance free lead-acid accumulator and so on.

6). Low voltage apparatus. Lengthen and extend industrial chains on the basis of low voltage apparatus industry of Touqiao Town in Hanjiang District.

5. Countermeasures for developing electrical appliance industry cluster in Yangzhou City

1). Strengthen planning and guiding and optimize industry layout. According to the guidance of state industry policy, combine with the practical situation of Yangzhou City , clear off its development thoughts and carry out an overall planning to electrical appliance industry. Bring the function of bridge and link of trade society into full play. Through trade society, investigate and stipulate development planning of this industry, strengthen guidance of this industry, and form an industry development layout with characteristics of outstanding key points, coordinational complement, health and order as soon as possible. In the aspect of planning and layout, pay attention to overall arrangement because new projects and construction expending projects are relatively concentrated. Promote the development of industry and gradually form industrial cluster and scale advantage.

2). Speed up carrier construction of industrial park zone and promote industrial centralization. Because park zone is the carrier for industry development, only on the basis of local industrial foundation and characteristics, can the decision of industrial direction for park zone efficiently promote industrial centralization. Therefore, further strengthen the current function of industrial centralization in park zone. Each park zone should not only compete with each other, but also properly divided its work in order to develop in differentiated directions and avoid excessively repeating construction. Continuously optimize management pattern in park zone, take the lead in forming management style and environment for new ventures which are in line with international standards and industry developing regulations, practically strengthen guidance, coordination and service for the current construction of park zone, adopt operation pattern in line with market principle, integrates various advantageous conditions including advantages of industrial chains, regional location, transportation, resources, talents and labor force, policy and so on, build an overall industrial platform which can recommend itself externally, exert itself to erect the whole images of industry with distinctive features, and push forward joint development of the whole industry.

3). Reinforce business invitation and capital attraction, and realize chaining development of industry. Seize opportunities of international property and capital shifting, bring advantages of good industrial environment of areas along Yangtze River, huge market potential and high quality of labor force into full play, strengthen publicizing for local distinguishing features and accessory environment of industry, reinforce attraction of foreign capital, and enlarge and strengthen industrial chains, actively packs the project of electrical appliance industry cluster, reinforce business invitation and capital attraction, introduce strategic and cooperative partners, speed up development by means of outside force, and promote various developing elements of capital, technique and talent to concentrate in park zone. On the whole, electrical appliance industrial chains in our city still develop at its initial stage. Particularly, the chains in upper and down stream are in urgent need to be strengthened.

4). Strengthen technical innovation of enterprises and improve core competitiveness of industry. Continuously push forward enterprises to become the main bodies of technical innovation, encourage enterprises to increase investment on research and development, establish market-oriented technical innovation mechanism, and carry out enterprise technical innovation project. Speed up construction of enterprise technical innovation system taking “one station and two centers” as main bodies in key enterprises and groups, guide enterprise to attach importance to intellectual property rights, especially patent application and protection of intangible assets and intellectual property rights, vigorously enhance the combination of production, study and research, promote cooperation between enterprises and universities and scientific institutions, establish a close combination of production, study and research with capital as link. Pay great attention to attracting foreign capitals for building research and development centers, and vigorously support domestic enterprises, scientific institutions, colleges and universities to combine with foreign-capital enterprises for setting up research and development centers. Promote combination of technology and commerce, enhance technical introduction by means of combination of technology and commerce, combination of technology and capital attraction, and combination of technology and other production elements, and pay attention to digest and absorption of introduced technologies so as to realize a positive cycle of introduction, digest, absorption, innovation and independent development.